Abstract [en]

The context of radical company restructurings i.e. downsizing and/or plant closures is extreme for employees who are facing unemployment, and consequently, makes partnership between management and employee representatives more difficult, compared to when the company is operating normally. However, before the decision on downsizing and/or closure emerges two ideal typical partnership approaches can be identified; “early coordination” or “formal negotiation”. The paper addresses two extreme cases, from the manufacturing sector in Sweden, mirroring the ideal types in closedowns. Formal negotiation usually trigger rapid closedown patterns due to the top management decision. In cases when “early coordination” is adopted there are increased possibilities to mitigate the negative consequences and ease the pain caused to labor. From a partnership perspective the central issue is how redundancies are handled and agreed upon (Dietz, 2004). We argue that “early coordination” during the restructuring facilitates proactive HRM strategies that focus on reconnecting employees to new employment on the local labor market. Coordination of actions means that management and employee representatives agree upon a closedown strategy in an early stage. Management need to seriously adopt social responsible approach where employees are considered as a primarily stakeholder in the process of closure. Employee representatives, on the other hand, need to accept flexibility measures in order to create a smooth restructuring.

The result shows that the case with coordinated actions resulted in long advance notice, education, training, job search etc. It also resulted in a domestically “nearsourcing” of subcontractor, which resulted in that 83 percent of the permanent employees got a solution in the new operations that were ‘nearsourced’ or new jobs at the local labor market. Whilst the other case resulted in internationally “oursourcing” of production which in turn resulted in that only a few of the displaced workers where reconnected to new employment on the local labor market (approximately 20 %). Thus, in the latter case the outcome resulted in higher unemployment rate for the workforce, compared to the case with early coordination. The comparative analysis also revealed different patterns in the course of restructuring, such as resistance to change.